Chapter 9: Lender has taken action against me

If you receive a court document called a statement of claim, summons or a writ then the lender may be taking legal action for:

• the whole debt, and/or
• the arrears (the amount you are behind in repayments), and/or
• possession of your home.

You can tell you have received a statement of claim, summons or writ because:

1. it will have a stamp from the court on the document
2. it will have the lender’s details and your details
3. it will be titled statement of claim, summons or writ
4. it will have details of the mortgage and that you failed to make certain payments as required under the loan
5. It will tell you how long you have to respond to the statement of claim, summons or writ.

If you are unsure whether you have received a statement of claim or summons get legal advice. Sometimes you may get another document called a notice to occupier sitting on top of these documents.

When you get a statement of claim, summons or writ, you have three options:

1. lodge a complaint with the free complaint resolutionscheme AFCA asking for financial hardship
2. lodge a defence and cross claim in court arguing youare in financial hardship (get legal advice first)
3. do nothing (not recommended).

It is strongly recommended you proceed with option 1 – which is to lodge a complaint with the complaint resolution scheme AFCA, rather than options 2 or 3.

The complaint resolution scheme, AFCA, is free and the lender cannot get a court judgment against you while AFCA is considering your complaint. You should only consider option 2, lodging a defence and cross claim, if you were not successful at AFCA or cannot use AFCA (for example, because your lender is not a member or a third party involved in causing you loss is not a member).

Lodging a complaint with the complaint resolution scheme, AFCA

See Chapter 7: Lender says no to repayment arrangement for details on how to lodge a complaint with AFCA. If you are lodging a complaint with AFCA after you have received a statement of claim or summons, you need to:

• make sure AFCA knows you have received a court document – you can write this on your complaint form
• the court document will tell you how long you have to respond
• lodge a complaint with AFCA as soon as possible after you received the statement of claim, summons or writ –there are only limited circumstances in which you can lodge a complaint with AFCA after the lender has obtained judgement so you need to move fast to make sure you are in AFCA well before the lender can apply for judgment
• (if you are close to the deadline) file a response to the statement of claim, summons or writ, you should also call AFCA to make sure it has received your complaint and has told the lender that it has received your complaint
• (even if you are negotiating with the lender) lodge a complaint with AFCA just to make sure the lender does not get judgment while you work out an arrangement.

Filing a defence and cross claim in court

This should only be considered if you cannot go to AFCA or you have been unsuccessful in AFCA. You should get legal advice before filing in the court.

A defence and cross claim need to be specific to your own case.

Get legal advice. See Chapter 14 Useful contacts for how to find a lawyer.